Question

Premium % is $8$%. Dividend % is $12$%. Amount invested is $100000$. MV is $20$. Calculate total dividend annually.

• A. $11111$
• B. $11100$
• C. $11110$
• D. None

Answer 1

The correct option is B $11100$

No. of shares $=\frac{100000}{200}=5000$
$PV=20\left(\frac{100}{108}\right)=1851$
Total dividend $=PV\times Dividend\times No.ofshares$
$=1851\times \frac{12}{100}\times 5000$
$=11100$